Nepal has taken a significant step toward reducing its fuel import bill by allowing the blending of domestically produced ethanol into imported petrol. The Cabinet recently approved an order enabling the Nepal Oil Corporation to mix up to 10 per cent ethanol, or E10, into petrol, reviving a policy discussed for nearly two decades.
The initiative is expected to save over Rs6 billion annually by cutting roughly 130 million litres of petrol imports each year. Officials say the move could also create jobs, boost sugarcane cultivation, and energise local industries while promoting cleaner fuel use. Ethanol production will rely on by-products such as molasses, Napier grass, agricultural residues, and unused biomass, explicitly excluding grains used for food.
